Monthly Archives: September 2015

The Workers’ Compensation Research Institute (WRCI) released a study today indicating that the Affordable Care Act (ACA) may shift claims into workers’ compensation.

Readers of this blog will have read by now the following posts from earlier this year that discussed at length what many in the workers’ compensation and insurance industries said would happen under the ACA.

The study begins by asking the question, “what is the extent to which the move to “capitated” group health arrangements under the ACA leads to cases that previously would have been paid under group health insurance to end up being paid under workers’ compensation.”

They refer to this as case-shifting, as opposed to cost-shifting, and state that if just 3% of group health cases with soft tissue injuries were shifted to workers’ comp, workers’ comp costs in a state like Pennsylvania could increase by nearly $100 million.

In California, the increase would be higher. More than $225 million, and in Iowa, the additional workers’ compensation costs would be around $25 million, or about 5% of the total benefits paid.

One mechanism the WCRI says by which cases would be shifted to work comp is the growth in the number of patients covered by “capitated” health plans.

Medical providers are reimbursed for each procedure in traditional fee-for-service medicine, which is often called, retrospective reimbursement.

Under capitated plans, the study says, medical providers receive a fixed annual payment per patient, which is often called, prospective reimbursement.

As I reported in my previous articles about cost-shifting, a patient covered by a capitated group plan presents different financial incentives about key decisions to a doctor and the health care organization they belong to, compared with a patient covered by a fee-for-service plan.

For example, if a capitated patient has back pain, the provider and the health organization do not get paid for additional care; whereas, for a patient under fee-for-service, the provider and the organization get paid for each service rendered. Workers’ compensation, the study points out, almost always reimburses on a fee-for-service basis.

Another question the study raised was, “to what extent do the financial incentives facing providers and their health care organizations that arise out of capitation influence the determination of whether or not a case is work-related?”

The decision of where to send the bill, the study says, should align with the physician’s assessment of whether the cause was work-related or not. It is the amount of uncertainty about the cause of the medical condition that provides the opportunity, according to the WCRI, for the financial incentives to influence the decision.

How the ACA ties into this is apparent in my post, “Accountable Care Organizations May Shift Claims into Workers’ Comp.” According to the WCRI, the ACA promotes the growth of ACO’s, which will increasingly integrate care from all providers under one capitated payment. They will receive one fixed payment regardless of the treatment the patient receives.

This, they say, will provide strong incentives to classify injuries as workers’ comp cases where possible. To date, over 500 ACO’s have been formed since passage of the ACA.

Additionally, the Obama Administration’s proposed moving to “value-based” reimbursement systems for physicians under Medicare (see my post, “Challenges Remain in Physician Payment Reform”), is also cited in the study as another mechanism leading to case shifting.

The WCRI states that the exact definition of this system is unclear, but that it is widely understood that this would imply more prospective reimbursement.

The WCRI looked at three groups of states. The first group was states where capitated plans were very common, the second group was states where capitated plans were somewhat common, and the third group was states where capitated plans were less common.

Case-shifting was only found in states where capitated plans were very common, and there was little case-shifting in the other two groups.

Case-shifting to workers’ comp, the study implies, will be expected to increase as capitation becomes more common.

Here are the key takeaways:

Patients covered by a capitated health plan was 11% more likely to have a soft tissue injury (back pain) called work-related than a patient covered by fee-for-service.

Patients with conditions for more certain causes (fractures, lacerations, contusions), there was no difference between patients covered by capitation or by fee-for-service; hence no case-shifting.

Case-shifting was more likely in states where a higher percentage of workers were covered by capitated plans. Two reasons for this are: more cases would be shifted if more patients were covered by such plans, and when these plans were more common, providers were more aware of the financial incentives to case-shift. In states where at least 22% of workers had capitated plans, the odds of a soft tissue injury being work-related was 31% higher than workers in fee-for-service.

In states where capitation was less common, there was no case-shifting. Providers were less aware of financial incentives when capitation was infrequent.

What does this mean?

This study confirms what I have been reporting on for much of the past half year, that the ACA may lead to more claims (or cases) shifted into workers’ comp, thus adding to the cost of medical care under workers’ comp, and further burdening an already burdened and broken system.

But it also confirms that there are rough times ahead for the industry, and that unless new ideas are brought forth and alternatives are seriously considered, and not outright dismissed just because someone say they should be dismissed, no matter how many years’ experience they have in workers’ comp, things will get worse.

The world is changing. Things once thought impossible are possible. Ideas once ridiculed are now accepted reality. No one can stop change, not by saying so, nor by any action on their part, so you might as well open your eyes, ears and minds to new ideas, and not shut them just because you don’t agree with them. One day soon, you will be gone, and the problems will still be there. The way forward is to embrace change now so that the future is better for all.

Clarification

Some of you may be thrown off by the title of this article as meaning that the study confirms that the ACA will lead to case-shifting. That is not what was meant. What was meant was that the study confirms what had been previously reported by others and that I had written about in the posts I referenced in my article. If there was any misconstruction on my part, I apologize.

One of the questions posed to me when I have discussed the idea of medical travel in workers’ comp is what to do with follow-up care.

In an article this week from Reuters, Andrew Seaman wrote that people may happily, and safely, forgo in-person doctors’ visits after surgery by opting instead for talking with their surgeons by phone or video. Seaman said this was the result of a small study of U.S. veterans.

The study, conducted by researchers in JAMA Surgery, said most patients preferred the virtual visits and that the doctors didn’t miss any infections that popped up after surgery.

Lead author Dr. Michael Vella, of Vanderbilt University Medical Center in Nashville said, “These kinds of methods are really important in the climate we’re in now,”…”So I think anything you can do to save money, see more patients and improve access to care is really important.”

Vella and his colleagues also wrote that there is interest in so-called telehealth to increase access to healthcare while also decreasing the costs associated with traveling to office visits.

Past research has found that telehealth visits may be useful in the treatment of chronic conditions and after surgery, but less is known about patients preferences for these types of visits, they added.

The study team evaluated data collected over several months in 2014 from 23 veterans, Seaman reported, and all but one of them were men, who were seen three times after a simple operation that would require only a night or so in the hospital. One visit was via video, the second was via telephone and the third was an in-person office visit.

The researchers found that no post-operation infections were missed during the video or telephone visits.

Dr. Vella said, “The veterans were very good at describing their wounds,” … “There was one patient who thought they were having problems, we brought them into clinic and there was an infection.”

Overall, the study found that 69 percent of the participants said they preferred a telehealth visit over the traditional in-office visit. Those who preferred the telehealth visit tended to live farther away from the hospital than those who would rather come into the office.

“I think (the study) challenges the paradigm that we need to see all patients back for visits,” Vella said.

Dr. Vella cautioned that the study was small, and they could not say that telehealth visits won’t miss problems. The study also cannot assess how telehealth visits would work for patients who have undergone more complex surgeries, according to Dr. Vella.

An alternative opinion was given by Dr. Sherry Wren, who was not involved in the new study, and also cautioned that not all patient preferences will align with the telehealth model.

“There will be patients who want to be seen, be reassured and want a doctor to check something out,” said Wren, a professor of surgery at the Palo Alto Veterans Affairs Health Care System in California.

Still, she said, many patients will like the option.

“There is a subset of patient that it’s not going to be appropriate for, but I think it’s a great alternative for the vast majority of patients.”

Dr. Vella said future research showing the results of the real-world implementation of telehealth will provide more information on its safety.

“I think it’s just really important that people continue to look at it,” he said.

What does this mean?

It means that when medical travel is ever implemented into workers comp, and that day grows ever closer, after a patient goes home to his/her country, they will still be able to get follow up care from the surgeon who performed the surgery, without having to fly back to the medical travel destination several times.

Will it work for everyone? Both Drs. Vella and Wren indicated that there are people who will not want it, and that there are subsets of patients that it will not be appropriate for, but overall they were both very positive about the future of telehealth visits after surgery.

If it worked for American veterans, it can certainly work for injured workers covered under workers’ comp, Veterans, especially those from our two ill-designed, ill-planned, and ill-conceived wars in Iraq and Afghanistan certainly have wounds more serious than most injured workers would suffer as a result of a work-related injury.

The only thing that stands in the way of introducing telehealth into workers’ comp, with or without medical travel, is what is between the ears of the leaders and “so-called” experts in the industry who have thus far gone and done the same things over and over again, and expect different results.

And you know what that is? Crazy, stupid, ridiculous, without any credibility, and without any traction in logic, which, I suspect is where the stuff between their ears are in.

My good friend, Elizabeth Ziemba, who I met last year in Reynosa, Mexico when I spoke at the 5th Mexico Health & Wellness Travel Show, published the following infographic on patient experience from The Beryl Institute.

It is called, “State of Patient Experience 2015: A Global Perspective on the Patient Experience Movement”.

US hospitals are designated in blue, non-US hospitals in light green.

The following is an excerpt from the infographic. The entire infographic can be seen here:

So the next time anyone says that the US has the best health care, or that medical care abroad can’t be better than it is here, or that the very idea of wanting to give injured workers access to the better medical care that these patient respondents said was better in non-US hospitals than in US hospitals, and is a stupid or ridiculous idea, show them this infographic.

Addendum

A connection of mine asked if there was a breakdown of the non-US hospitals. I looked at the research paper, and found none, but what I did notice was that there was slight differences in some measures between US and non-US hospitals, with the non-US hospitals slightly better than their US counterparts. What that tells me is that medical travel destination hospitals need to do a better job in those areas so that they outshine their US counterparts. Then they will see greater numbers of foreign patients.

“All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

Arthur Schopenhauer

It has been said by some that sending injured workers, most of whom are Latino, to countries in Latin America for surgery for injuries common to workers’ comp such as knee surgery, back surgery, hip surgery, etc., is a stupid or ridiculous idea.

So I thought about all the other stupid and ridiculous ideas that humans have been told was stupid or ridiculous at the time they were first conceived, but were later shown to be not stupid or ridiculous.

Where to begin? A logical place to start is the beginning, so let’s go back to the beginning of human civilization. Back then, humans used stone tools, having graduated from bones and sticks.

So I suppose that the first human to create a wheel was told it was a stupid or ridiculous idea.

Moving forward in time, it was once said that the Earth was flat; yet, the Greeks discovered that the Earth was round more than two thousand years ago.

Also, in Greece, the idea that humans could fly was kind of proved by our old friend, Icarus, that is, until his wax wings melted and he discovered gravity, another stupid or ridiculous idea that Newton later confirmed with an apple.

The Wright Brothers didn’t think flying was a stupid or ridiculous idea, and they were bicycle mechanics. What did they know about flying? On that same subject, Leonard Da Vinci envisioned the helicopter centuries before Sikorsky built his first one.

It is also said that the Chinese had rockets centuries before Robert Goddard, Werner Von Braun and others help us into space, which itself was considered a stupid or ridiculous idea.

The very idea of going to the Moon was called stupid or ridiculous until Jules Verne wrote, and a movie was made about doing just that. Then came JFK and the Apollo moon missions, which gave us the computer I am writing this on, the cell phone I carry in my pocket, and the microwave ovens we have in our kitchens. Again, more stupid or ridiculous ideas that weren’t.

Jules Verne was also the one who said submarines were not a stupid or ridiculous idea, although he was not the first one who invented one. John Holland and others did so a century earlier than Verne’s “Twenty-thousand Leagues under the Sea”.

Let’s go back to cell phones a minute. Back in 1966, a daring television writer named Gene Roddenberry developed a television series where the characters in the show carried a little box that flipped open and allowed the person holding it to communicate with a ship in orbit. That show was Star Trek, and the Communicator became our cell phones. Again, another stupid or ridiculous idea? Then what’s that ringing in your pocket? Oh, and by the way, the telephone itself was a stupid or ridiculous idea until Bell invented it (more like patented it).

Here are a few more stupid or ridiculous ideas that became reality:

Splitting the atom

X-rays

Wonder drugs

Sound recordings

Video

Movies

And who were these people who said these and other ideas were stupid or ridiculous?

Experts

So I guess they really weren’t experts after all. Only stupid or ridiculous people who wanted to retard progress. And that is really stupid or ridiculous. In fact, to quote Mr. Spock, it is “highly illogical.”

As for having injured workers go abroad for medical care in workers’ comp?

It’s not another stupid or ridiculous idea. Just one whose time has not yet come. But it will.

Just ask those individuals who invented or conceived the ideas I mentioned above and were told their ideas were stupid or ridiculous, but weren’t after all.

According to Altman and Blumenthal, most physicians in primary-care said that their ability to provide high-quality care had not changed since January 2014.

Altman and Blumenthal included a graph showing the percentages of physicians who were polled by Kaiser and the Commonwealth fund on their ability to provide high-quality care.

The survey found that, so far, the fears of problems have largely not come to pass. However, physicians did report increased demand for services under the ACA; four in ten (44%) said that the total number of patients they see had increased since January 2041.

Six in ten, or (59%), reported an increase in the number of patients who were newly insured or covered by Medicaid, but this was not swamping their practice.

The chart shows that 59% said their ability to provide care had stayed the same, 20% said that it had improved and gotten worse.

Altman and Blumenthal concluded their article by saying that not yet two years into the coverage expansion of the ACA, it is still too early to know what effect will be, long-term, on the demand for services.

It could also be, they said, that the net increase of 16 million newly insured is less of a burden than expected; however, they concluded by saying that primary-care providers have been able to keep up demand without any negative impact.

Whether this remains so, is yet to be determined, but so far, it appears that there is no nationwide crisis.

Whether the figures she cites are true or not, something is happening with medical travel, and it has the potential to change how medical care is conducted in the future.

Those who doubt this, or who criticize the idea of medical travel, whether for non-employment medical issues, or for work-related injuries requiring surgery, the fact that Becker’s is discussing it should signal that it is an important development, despite what certain individuals call a “stupid idea”.

According to Tom, a report from IVantage Health Analytics, a leading advisory and business analytic company, stated that 283 rural hospitals across the US are on the verge of closing.

These closings affect hospitals in 39 states. IVantage’s report indicated that in states that expanded Medicaid, 8.5% of their rural hospitals are vulnerable to closure, and this is compared to 16.5% in states that have not expanded Medicaid.

Tom also said that over 700,000 patients would have to travel much further away from their homes to find medical care that is equivalent to what they get currently.

In addition, over 85,000 workers would lose their jobs if these hospitals were to shut down, and the nation’s GDP would see a $10.6 billion dollar loss.

What does this mean to you?

For medical travel, it represents a golden opportunity, not only for general health care services, but for work-related injuries and illnesses, as many companies are located in rural parts of the US.

For workers’ comp, what difference does it make if a rural injured worker has to fly a few hours to a larger city in the same state or region of the country, or if you put him on a plane and fly him to a medical travel destination, the flight there would be roughly the same flight time as the domestic flight?

We are losing this battle, and the only thing both industries want to do is bury their heads in the sand and ignore the potential business and cost-savings available.

Your choice, but when you need to get an oil pipeline worker in North Dakota to a hospital, it better be in Canada, because that will be the closest one available.

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Quotes

“Impossible is just a big word thrown around by small men who find it easier to live in the world they’ve been given than to explore the power they have to change it. Impossible is not a fact. It’s an opinion. Impossible is not a declaration. It’s a dare. Impossible is potential. Impossible is temporary. Impossible is nothing.”

– Muhammad Ali

“If people are not laughing at your goals, your goals are too small..”

– Azim Premji

“Those who say your dreams are ridiculous have given up on theirs.”

– Unknown

Permanence, perseverance and persistence in spite of all obstacles, discouragements, and impossibilities: It is this, that in all things distinguishes the strong soul from the weak.

– Thomas Carlyle

“As the work is done for the employer, and therefore ultimately for the public, it is a bitter injustice that it should be the wage-worker himself and his wife and children who bear the whole penalty.”

– President Theodore Roosevelt, 1907

To permit every lawless capitalist, every law-defying corporation, to take any action, no matter how iniquitous, in the effort to secure an improper profit and to build up privilege, would be ruinous to the Republic and would mark the abandonment of the effort to secure in the industrial world the spirit of democratic fair dealing.

– Theodore Roosevelt, 1908

“The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.”

– John Kenneth Galbraith

“Only a fool would try to deprive working men and women of their right to join the union of their choice.”

– Dwight D. Eisenhower

“I hope we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial by strength, and bid defiance to the laws of our country.”

– Thomas Jefferson

“Mischief springs from the power which the moneyed interest derives from a paper currency which they are able to control, from the multitude of corporations with exclusive privileges… which are employed altogether for their benefit.”

– Andrew Jackson

“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. Corporations have been enthroned, an era of corruption in high places will follow, and the money-power of the country will endeavor to prolong it’s reign by working upon the prejudices of the people until the wealth is aggregated in a few hands and the Republic is destroyed.”

– Abraham Lincoln

“Do not go where the path may lead; go instead where there is no path and leave a trail”

– Ralph Waldo Emerson

“Some men see things as they are and say why. I dream things that never were and say why not.”

“Capital is reckless of the health or length of life of the laborer, unless under compulsion from society.”

– Karl Marx

“The secret of change is to focus all of your energy, NOT on fighting the old, but on BUILDING the NEW.”

– Socrates

“Every man takes the limits of his field of vision for the limits of the world”

– Arthur Schopenhauer

“All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

– Arthur Schopenhauer

“You have enemies? Good. That means you’ve stood up for something, sometime in your life.”

– Winston Churchill

“No matter what people tell you, words and ideas can change the world.”

– Robin Williams

“There can be no equality or opportunity if men and women and children be not shielded in their lives from the consequences of great industrial and social processes which they cannot alter, control, or singly cope with.”

– Woodrow Wilson

“Although it is not true that all conservatives are stupid people, it is true that most stupid people are conservative.”

– John Stuart Mill

“The masters of the government of the United States are the combined capitalists and manufacturers of the United States.”

– Woodrow Wilson

“The test of our progress is not whether we add more to the abundance of those who have much it is whether we provide enough for those who have little.”

– Franklin D. Roosevelt

“Of all the forms of inequality, injustice in health [care] is the most shocking and inhuman[e]…”